China slashes fines on ride-hailing violations
Mainland authorities have significantly reduced fines slapped on those who provide unlicensed ride-hailing services, months after the State Council moved to relax penalties in the transport industry to introduce further local administrative discretion.
Individuals who provide ridehailing services without a specific permit for their vehicles will be fined from 3,000 yuan (HK$3,346) to 10,000 yuan, while drivers with no qualifications will be charged from 200 yuan to 2,000 yuan, according to the latest revisions made to the interim measures for the administration of online taxi booking business operations, which were announced on Monday by the Ministry of
Transport and five other agencies.
Those penalties are down from a range of 10,000 yuan to 30,000 yuan for the violations stipulated in the original rules enacted in 2016.
Ride-hailing drivers also no longer face penalties for failing to carry their vehicle and driver permits, an offence previously subject to a fine ranging from 50 yuan to 200 yuan.
On the mainland, ride-hailing drivers and the vehicles used to provide such services must be licensed by the government.
The revisions reflect continued efforts by the central government to improve the legal framework covering the country’s ride-hailing services market, which is the world’s largest following the end of its year-long cybersecurity investigation of Didi Chuxing.
In August, the State Council, the country’s chief administrative body, issued a circular that cancelled 29 penalty charges in public security, transport and market regulation, and adjusted 24 fines in transport and market regulation.
The relevant departments are expected to be responsible for drawing up new regulations to replace those penalties, providing more accurate and scientific regulatory supervision, according to the circular.
There were a total of 290 ridehailing platform companies licensed to operate in the country at the end of October, up from 251 a year earlier, according to data from the transport ministry. Total ride-hailing orders reached 574 million nationwide as of October, down from 692 million previously.
The latest revisions did not change the existing penalties imposed on ride-hailing platforms, which still face a fine ranging from 10,000 yuan to 30,000 yuan for operating without a licence.
Beijing-based market leader Didi, which went public in New York last year under the name Didi Global and subsequently had itself delisted, is facing increased competition in the domestic ridehailing industry from a number of big tech companies after its much-publicised debacle. Beijing’s year-long cybersecurity investigation of Didi ended in July when regulators slapped it with an 8.03 billion yuan fine.
On-demand delivery platform operator Meituan, telecommunications equipment giant Huawei Technologies and Tencent Holdings’ WeChat have been investing heavily in the ridehailing field, each one hoping to carve a foothold in a market where Didi once controlled more than a 90 per cent share.
Before the latest revisions, the transport ministry summoned 11 ride-hailing platforms in August to lecture them about improving compliance and protecting the rights of their drivers and passengers.